Instagram Adds Business Accounts, A Potentially Valuable Data Source

Facebook-owned Instagram debuted business profiles and account tools on Tuesday.

While many personal accounts are used for business, Instagram formalized the system and added promotional capabilities like putting spend behind a post and basic targeting, measurement and reporting tools.

While business accounts aren’t meant to be an enterprise-class solution, the vast majority of advertisers on Instagram as of February were small businesses, said Vishal Shah, Instagram director of product management for the monetization group.

“We know there are many, many businesses using Instagram successfully already, and we think these can become great customers with these tools, but that’s not the primary reason,” said Shah.

The reason Instagram hadn’t pushed the product out sooner is because the team “wanted to make sure it would be additive to everyone involved,” said Shah in reference to whether and how users would want businesses featured on their feeds.

“The first thing was, more advertisers does not mean more ads,” he said.

It’s also a nice data pipeline for Instagram (and Facebook), which can bring value to independent small businesses through basic measurement and optimization while absorbing retail info with enough scale for network effects to come into play.

For instance, the business account profiles prominently feature an option to call the business directly, and can also provide directions to the location, link to a product page or prompt customer messages. Facebook is logging all of those instances, and is working to connect those engagements (and ad campaigns) with sales.

Anything a user sees will be an “Instagram-controlled experience,” said Shah. “But when we think about how we do things on the back end like measurement, targeting and the data we’re bringing in, we want to be tapping into what we have here at Facebook.”

When asked about the product road map for the Instagram business profiles, Shah said, “This is really a starting point. We’ll be looking for additional info around people visiting or contacting a store or, on the promotional side, new ways for local businesses to drive traffic into a store.”